Lizard lays egg in heath (7)
I believe the answer is:
monitor
'lizard' is the definition.
(monitor is a kind of lizard)
'egg in heath' is the wordplay.
'egg' becomes 'nit' (nit is a kind of egg).
'in' means one lot of letters goes inside another.
'heath' becomes 'moor' (I've seen this before).
'nit' placed inside 'moor' is 'MONITOR'.
'lays' is the link.
This may not be right. It may belong to another bit of the clue.
(Other definitions for monitor that I've seen before include "Checking device - VDU - lizard" , "Vet" , "Keep tabs on; lizard" , "Observe over time" , "one checks continuously" .)